Social products have always been a controversial area. Whether in the traditional Internet or on the chain, there are endless debates about social applications. As Marx’s famous saying goes, “Man is the sum of all social relations.” By abstracting the underlying logic of social products, we can get the following logic: the core of a social product is to help users establish certain social relationships, generate interactions, transmit information, and expand their social networks on this application. This is considered a successful social product.

Therefore, based on different forms of social networks, countless familiar products have appeared in the traditional Internet, such as Facebook, WeChat, Soul, etc. They build social networks for various social scenarios such as acquaintances/strangers/campuses. This is the social product in the traditional Internet.

For Web3 social products, due to the characteristics of financialized asset issuance, the “Fi” feature is added to the social network. How to issue assets based on social networks, or how to build social networks through assets, is the core point of the web3 SocialFi project. The decentralized anti-censorship liberal ideology puts higher requirements on the project party in terms of content control. Therefore, the SocialFi track is also the most difficult product to build among all Web3 products.

In this article, we will analyze several SocialFi products that have developed relatively well on the market, Farcaster, FriendTech, UXLINK and CyberConnect as examples, and explore the growth path of SocialFi products.

From the number of user addresses to the value of assets, how to determine the true growth of SocialFi?

In the previous article, we mentioned that the core of SocialFi lies in the combination of social networks and assets. Whether it is issuing assets based on social networks or building social networks based on assets, it is the fundamental logic of SocialFi products. Next, we will analyze the above-mentioned products from the two levels of social networks and asset issuance, and then select indicators from various dimensions of these products for comparison.

Social network form

The social network topology in Farcaster is the same as that of Twitter. Both are attention-based social networks with relatively open networks; FriendTech purifies and strengthens Twitter’s social network, and its form is a closed network with a single node as the core; Compared with Farcaster and FriendTech, which inherited Twitter’s online social network centered on attention, UXLINK’s network form focuses on real-world social networks, bringing acquaintance social interaction onto the chain; CyberConnect forms social networks through on-chain activities.

Asset issuance level

Farcaster positions itself as the basic layer of social interaction. It does not have a strong “Fi” attribute, but has a stronger community cultural attribute. On this basis, it has generated the core asset $degen; FriendTech v1 has taken the attribute of asset issuance to the extreme, creating a Ponzi flywheel through the design of the Bonding Curve, giving each KOL’s social network an asset bubble, and the value of Twitter’s social network is fully reflected by the liquidity of the room key; UXLINK is more balanced than the previous two, and the design of the dual-token model is more stable and healthy for the entire system, which can more continuously motivate users to create value in social networks; CyberConnect only governs through its own native tokens, and relatively lacks incentives for social network expansion.

After the qualitative analysis, we need to start quantitative analysis. We first select basic indicators at the social level and asset level to make judgments. First, at the social attribute level, we select the number of active users of the protocol as the indicator; and at the asset level, we select the market value of the core assets of the protocol as the indicator.

Social attributes

• Number of active addresses of the protocol

  -Farcaster’s DAU began to grow rapidly in February this year, and then fell in March and then added more new users.

-FriendTech

In the v1 version of FriendTech, users were active in order to win airdrops and earn points. From the end of last year to April this year, due to FriendTech’s delay in issuing coins, user confidence dropped and users were lost. After the v2 version issued coins, the vast majority of users chose to give up.

UXLINK’s growth rate this year has been astonishing. In May, the number of addresses reached nearly 500K, and it has quietly reached a user base that is several times that of other protocols.

The number of CyberConnect users experienced a rebound in the first half of this year, but relatively speaking, the stamina is relatively insufficient.

Overall, UXLINK is undoubtedly the most popular blockchain social infrastructure at the moment, and the activity on the chain far exceeds the other three major competitors in the SocialFi field. According to UAW (Unique Active Wallets), the number of active wallets of UXLINK is as high as 729.5k, ranking first among all Social Media Dapps.

In comparison, the UAW of the other three mainstream SocialFi products during the same period was much lower than that of UXLINK. Although this indicator mainly reflects the on-chain activity of each product in the short term, it also proves that the current attention of Web3 social players has been greatly attracted to UXLINK.

Asset attributes

• Farcaster itself has a weaker asset attribute. Here we select the asset ‘Degen’, fermented out by the community, as the representative asset. Its price soared in April with the explosion of the base ecology, and recently it fell with the cooling of the ecology.
• )
  FriendTech issued currency in v2, and the price of the currency became relatively stable after digesting the airdrop pressure.

• The Cyberconnect token has been issued for more than two years. In the first half of the year, the price increased due to the hype on the track, and then fell back to the low point.

• UXLINK has not released assets yet and will not be compared here.

Overall, UXLINK ranks first among current Web3 SocialFi products in terms of user numbers with its amazing social network expansion rate, while FriendTech uses its innovative asset issuance mechanism to attract players eager to make money.

The underlying factors behind the appearance: Positioning and focusing on the North Star indicator

If we abstract the behavior of users in social products, we can describe it in the following mode: “Users expand their social networks in the product and interact to complete information transmission.” After adding asset attributes, the behavior can be expanded to complete asset transactions in addition to information transmission. In SocialFi products, information exchange is often accompanied by asset transactions, which brings the entire economic ecosystem to life. The product itself can also gain benefits from the economic behavior in the ecosystem. Therefore, in this article, protocol revenue is selected as the North Star indicator for measuring a social product.

• When FriendTech was released, its innovative asset issuance mechanism brought it to a peak. As the popularity declined, the activity in the economy continued to decline. However, after the release of v2, the token airdrop and innovative club design raised the popularity again.

• Farcaster has ushered in a wave of strong growth this year with the explosion of the base ecosystem, and the influx of new users has brought about an increase in protocol revenue.

• CyberConnect’s revenue was close to zero after the airdrop, which shows that users do not have strong real social needs for this product.

• The UXLINK economy is relatively early and has no data, so it is not listed here.

In SocialFi, if you have to choose between the “Social” and “Fi” attributes, then products with “Fi” as the core will win in the competition. After all, in Web3, transactions are the underlying needs of all users.

Mapping indicators to products, how to optimize product design

We can see that the rise of the above representative socialfi products and the activeness of the economy are strongly related to the issuance of assets, which also reflects that for web3 products, asset issuance is the first principle and transaction is the underlying demand of users. All SocialFi products should think about how to embed user transaction behavior into the social network of their own products.

For CyberConnect, users did not have any transaction scenarios in the product. The early users were active to meet the airdrop rules, not for real social needs. This also explains why the economic activity of CyberConnect fell sharply after the airdrop ended.

For Farcaster, during the Ice Age, the decentralized front-end allowed many liberal users who disliked Twitter’s censorship to retain the spark of its resurgence. At the same time, it is the base camp of the base ecology. With the rise of the base ecology, it has been active as a gathering place for high-quality alphas of the base chain.

For FriendTech, airdrops were used to attract users to engage in social activities in the early stage. In v2, it helped big Vs to create clubs and issue tokens through influence to realize monetization, and brought tradable assets to ordinary users to maintain the activity of the economy. However, the trading behavior was relatively unclear, and the Farcaster team itself seemed to be downplaying the “Fi” attribute.

From the perspective of token issuance, FriendTech and UXLINK are the most user-friendly and are most likely to have a wealth effect to attract users; from the perspective of social network form, Farcaster and UXLINK have relatively stronger social attributes and can keep the entire economy resilient enough. Therefore, we can look forward to their performance after they go online and pay attention to the issuance of assets based on acquaintance social networks.

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